Last week I explained what a security interest is and how it can be perfected, i.e., made effective against third parties. (See What is a Security Interest, and Why Should I Care?) This post discusses how to perfect an intellectual property security interest.

To recap, a security interest is an interest in an asset (the “collateral”) intended to secure performance of an obligation. Typically, that obligation is payment of a debt. Perfection typically consists of filing, with one of more secretaries of state, documents that identify the debtor, the creditor and the collateral. (more…)

Copyright and trademark owners typically like to exercise their legal rights as broadly as possible. There is however, a well-known limit to those rights called the “first sale doctrine“.

Actually, they are two separate but similar doctrines. One pertains to copyrights, the other to trademarks:

Copyrights – 17 USC Section 109(a) states, with certain exceptions, that the owner of a lawfully-made copy of a work may sell or dispose of the work. Consent of the copyright owner is not required. So, for example, if you legitimately possess a book or a CD, you may sell it or give it to someone else or throw it into a trash bin.

Trademarks – The trademark first sale doctrine is a product of case law rather than statute. In Sebastian International, Inc. v. Longs Drug Stores Corporation, the United States Court of Appeals for the Ninth Circuit wrote: “[W]ith certain well-defined exceptions, the right of a producer to control distribution of its trademarked product does not extend beyond the first sale of the product. Resale by the first purchaser of the original article under the producer’s trademark is neither trademark infringement nor unfair competition.” The exceptions include, for example, stolen or counterfeit goods or goods that have avoided the producer’s quality control systems.

The app purported to allow women to calculate the size of a man’s penis based on his shoe size. According to webOS Nation, the app was downloaded only 84 times before it was removed in September 2012. Yet press reports state that the plaintiffs are seeking damages of $500 million for trademark infringement and unfair competition!

A client sells high-quality collectibles manufactured from authentic sports-related materials (game-used balls, uniforms, arena flooring, stadium seats, etc.). The company ensures that all materials are licensed by the applicable university or professional sports organizations so it can use the organizations’ names and trademarks in promotional activities. Some competitors do not pay for the required licenses, however – and one of these recently was caught as the result of a Groupon promotion.

The database will be developed in conjunction with ICANN’s forthcoming implementation new generic top-level domains (gTLDs). ICANN CEO Rod Beckstrom is quoted in the Chron article as saying (emphasis added): (more…)

Let’s assume that your website has particularly effective visual and interactive elements that you would not want another website to copy. This post discusses how you can protect your website’s “look and feel“.

Look and Feel as Trade Dress

Look and feelfalls in the category of trade dress, i.e., visual appearance that signifies the source of a product or service. You may be able to obtain a federal trademark registration for the non-functional elements of the website’s look and feeland bring suit against infringers based on that registration.

This is just too delicious: One group of “Tea Party” activists – known for opposing federal government intrusiveness – has brought suit against the registered Tea Party political party in the U.S. District Court for the Southern District of Florida (South Florida Tea Party, Inc. v. Tea Party).

Plaintiffs seek a declaratory judgment that (1) their use of “Tea Party” does not infringe any trademark or other intellectual property right, (2) Defendants to not have any exclusive intellectual property right to use “Tea Party” in politics, and (3) Defendants shall not make any false associations between themselves and grass roots “Tea Party” movements. (The third point seems to be more like a request for injunctive relief rather than a declaratory judgment, but intellectual rigor and consistency may not be major concerns, in this case.)

Perhaps plaintiffs did not notice that the U.S. District Court is part of the despised federal government?

We all are familiar with well-known? franchises, such as McDonald’s restaurants. What many people do not realize, however, is that a trademark license agreement, if it has certain characteristics, can be considered a franchise agreement under state or federal law, creating huge potential liabilities for the unwary licensor.

A franchisee is granted the right to engage in the business of offering, selling or distributing goods or services under a marketing plan or system prescribed in substantial part by a franchisor; and

The operation of the franchisee’s business pursuant to such plan or system is substantially associated with the franchisor’s trademark, service mark, trade name, logotype, advertising or other commercial symbol designating the franchisor or its affiliate; and

The franchisee is required to pay, directly or indirectly, a franchise fee.

Dana H. Shultz, Attorney at Law, is a business-savvy lawyer located in Northern California's San Francisco Bay Area (in the East Bay, near Oakland) who has in-depth knowledge of law, business, technology, and the needs of startup and early-stage companies.